More than 7.7 million self assessment tax returns have already been filed for the 2022 to 2023 tax year, leaving at least 4m tax returns outstanding and due by 31 January.

HMRC is reminding anyone who still needs to pay their tax bill to do so before the deadline on 31 January or risk facing a penalty.

Those who are unable to pay their tax bill in full can check online to see if they can set up a monthly payment plan called Time to Pay. If they owe less than £30,000, they can use the HMRC affordability checker to help decide the best arrangements for them. Interest will be applied to any outstanding balances from 1 February, the same day as penalties kick in for late filing.

Myrtle Lloyd, HMRC’s director general for customer services, said: ‘We want to help Self Assessment customers meet their obligations and there is no time like the present to choose the right payment option for you. Whether you choose to pay in instalments, via the HMRC app or using online banking, search ‘pay your Self Assessment tax bill’ on gov.uk for a full list of options.’

In addition to those who have set up an online payment plan, in December 2023, 28,794 taxpayers used the free and secure HMRC app to pay more than £42m in tax owed. Taxpayers can also receive a tax refund via the app. They should include their bank account details when filing, so that if HMRC needs to make a repayment, they can do so quickly and securely.

For those who pay their current estimated tax bill via Payment on Account, the first instalment for the 2023 to 2024 tax year is due on 31 January.

Penalties

HMRC will consider a taxpayer’s reasons for not being able to meet the deadline for completing their self assessment on time. Those who provide HMRC with a reasonable excuse may avoid a penalty. The penalties for late tax returns are:

•            an initial £100 fixed penalty, which applies even if there is no tax to pay, or if the tax due is paid on time;

•            after three months, additional daily penalties of £10 per day, up to a maximum of £900;

•            after six months, a further penalty of 5% of the tax due or £300, whichever is greater;

•            after 12 months, another 5% or £300 charge, whichever is greater.

There are also additional penalties for paying late - 5% of the tax unpaid at 30 days, six months and 12 months. Interest will also be charged on any tax paid late.

During January, HMRC is providing helpline support to taxpayers who have queries about self assessment payments, repayments and who need help completing their tax return. For all other queries go online to find guidance, videos and tools. Go to gov.uk and search ‘self assessment’.